Engineering giant ABB India’s scrip shot up 23.4% after its Swedish-Swiss parent firm announced plans to raise its holding in Indian arm to 75% and has made an offer to buy shares at Rs 900 a piece that could cost it as much as Rs 4,365 crore ($970 million).

As of March 31, the Swedish parent owned as much as 52.89% and now plans to hike to the maximum it can as per new norms which calls for at least 25% public shareholding (including financial institutions). While domestic financial institutions own 23.5% of the company, FIIs hold 10%. The rest is owned by retail shareholders and corporate bodies.

This means not all the shares tendered in the open offer will be accepted. HSBC Securities is managing the open offer.

For the last quarter ended March’10, ABB India saw 4.5% rise in revenues even as net profit crumbled over 90% due to higher wage bill, forex loss and poor performance of its power division.

This is the second big move by the ABB global CEO Joe Hogan since he took over in September 2008. The former CEO & President of GE Healthcare, had scripted a billion dollar plus deal when it acquired US software company Ventyx early this month. ABB is a cash rich firm with as much as $7.1 billion of cash and cash equivalents as of December 31.

However analysts are wondering what benefit will the open offer bring to ABB globally. It already controls the management and may not be able to encash more in dividends anytime soon given the poor financial performance.